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eBay and the web's crisis of trust

Trust is the web's biggest stumbling block.

The web offers businesses almost unlimited commercial potential. The primary thing limiting that potential, however, is trust (or, rather, a lack of it). How do I do business with a stranger online? eBay has come up with its own answer, but it hasn't worked out as well as hoped, as Nick Carr notes:

By providing buyers and sellers with a simple means for rating one another, eBay has been able, we've been told, to avoid lots of rules and regulations and other top-down controls. The community, built on trust and fellow-feeling, essentially manages itself. Tom Friedman, in his book The World Is Flat, voiced the common opinion when he called eBay a "self-governing nation-state."

Nice story. Too bad it didn't work out.

The reason is self-interest, which doesn't always mesh well with other-interest. This is absolutely a problem with impersonal systems like eBay. It is not, however, a problem with true social networks (which map one's social graph, rather than promiscuously adding "friends" Facebook-style).

Do we have this yet? No. But to the one who builds it, there's a billion dollars waiting for them. Facebook could do it but is very far from it today.

It's just a matter of tracking one's social interactions, all of which are textual/data today. My email, AT&T Wireless account, etc. all clearly state who I trust, measured by who I interact with on a regular basis. I may not like every one of those people, but I trust them. I know where to find them if they stiff me in an auction.

But not today in an eBay auction, which is why I don't buy or sell there. I do my online buying with trusted merchants like Amazon and my selling on Craigslist, where at least I can meet the person to whom I'm selling something and walk away with cash.

Trust is the biggest issue on the web today. The ironic thing is that it shouldn't be too hard to acquire it. The data is there to construct it.